• I want to consult about a traffic accident in the Yaizu, Makinohara, Yoshida, Omaezaki, and Fujieda area
• I want to know about lost wages when injured in a traffic accident
• The at-fault driver's insurance company offered a lost wages amount, and I want to know if it is fair

Are you troubled by issues like these in Yaizu, Makinohara, Omaezaki, Fujieda, Shimada, Yoshida Town, or surrounding areas?
Yaizu Sogo Law Office offers a free initial legal consultation regarding traffic accident concerns. There is no obligation to retain our services after the initial consultation. We are also available on weekday evenings and Saturdays. Please feel free to contact us by phone or email.

1 What Are Lost Wages?

Lost wages refer to the loss of income resulting from the victim's inability to work due to injuries sustained in a traffic accident, during the treatment period until the symptoms are determined to have stabilized.

Items Commonly Disputed in Lost Wages for Salaried Employees

• Base salary
• Overtime pay (fixed overtime / variable overtime)
• Position-based allowance
• Commuting allowance
• Housing allowance

All of the above are included in "income." If only the base salary was used for the calculation, it is a clear underpayment.

2 How to Calculate Lost Wages

Lost wages are generally calculated using the following formula.

3 The Daily Income Rate Offered by the At-Fault Driver's Insurance Company

In most cases, the at-fault driver's insurance company calculates ① as the average daily amount over a certain period that includes non-working days (i.e., the total number of calendar days in the three months before the accident).

For example, if the total salary for the three months (90 days) before the accident was 900,000 yen, the pre-accident daily income (①) would be 900,000 yen ÷ 90 days = 10,000 yen.

However, this method produces a lower daily income rate because it includes non-working days, resulting in an underestimation of the victim's actual lost wages.

Problems with the Insurance Company Method

• The daily rate is inevitably lower because non-working days are included in the divisor
• As a result, those with more overtime are more likely to be underpaid
• The insurance company may claim "this is the standard method for salaried employees," but this is incorrect

In practice, because this "insurance company method" is used, it is not uncommon for victims to suffer losses of tens of thousands to hundreds of thousands of yen.

4 The Calculation Method Used in Court

In court practice, for salaried employees and other wage earners, ① is typically calculated by dividing the salary received by the actual number of working days before the accident, and the lost wages are then determined by multiplying this figure by the number of days absent from work.

For example, using the same scenario as above, if the total salary for the three months before the accident was 900,000 yen and the actual number of working days during those three months was 60, the pre-accident daily income (①) would be 900,000 yen ÷ 60 days = 15,000 yen.

This method does not include non-working days and therefore accurately reflects the victim's actual losses.

The Court Standard Is the Most Accurate

• Calculation is based only on actual working days
• Closest to actual income; most favorable for the victim
• Accurately reflects the amount of overtime
• Established in practice as the "correct calculation method"

Be sure to check whether the insurance company's offer follows this method.

5 Common Disputes Over Lost Wages

Lost wages are frequently disputed with the insurance company on the following points.

• Being told "there is no lost wages claim if you used paid leave" (-> clearly incorrect)
• Overtime pay not being included
• Allowances such as commuting allowance not being counted as income
• The employer refuses to issue a Certificate of Lost Wages
• The insurance company unilaterally reduces the number of compensable days

All of the above are issues that are likely to be corrected if proper claims are made.

6 Summary

Victims should carefully review the calculation method used for the daily income rate in the lost wages assessment provided by the at-fault party, and if the method described in Section 3 above was used, they should request a recalculation.

Lost wages are an item that is often increased over the insurance company's initial offer when calculated correctly. Particularly for salaried employees with complex pay structures, we strongly recommend having an expert review the calculation.

If you would like an attorney to explain the lost wages offered by the at-fault driver's insurance company, please contact our office.

Frequently Asked Questions

The Initial Legal Consultation for Traffic Accidents at Yaizu Sogo Law Office Is Free of Charge

Yaizu Sogo Law Office provides a free initial legal consultation regarding traffic accidents.

We handle all traffic accident-related legal matters, regardless of severity or whether they involve property damage or personal injury. If you are feeling stressed by dealings with insurance companies, or if you want to know whether the amount offered by your insurance company is fair, please do not hesitate to consult with us.

Yaizu Sogo Law Office is available not only during regular weekday hours but also on weekday evenings and Saturdays. Please contact us by phone or email to schedule a legal consultation.

Are You Troubled by a Traffic Accident?

• Settlement Offers from Insurance Companies Are Almost Always Low
• The Insurance Company Said They Would Cut Off My Medical Expenses
• Dissatisfied with the Fault Ratio
• When and How to Consult a Lawyer About a Traffic Accident
• What Claims Can Be Made in a Personal Injury Accident?
• What Claims Can Be Made in a Property Damage Accident?
• What You Need to Know About Whiplash
• Traffic Accidents and Health Insurance
• Procedures and Steps to Follow After a Traffic Accident
• Fault Proportions Between a Through-Going Vehicle and a Right-Turning Vehicle at an Intersection
• Diminished Value (Loss of Market Value)
• Amount Claimable from the Other Party When Personal Injury Protection Insurance Was Used Prior to the Claim for Damages Against the Other Party
• Free legal consultation is available for traffic accidents
• Filing a Victim's Claim with Compulsory Automobile Liability Insurance (CALI)
• Lost Wages for Salaried Employees (Wage Earners) in Traffic Accidents
• Understanding a Company's Losses When Employees Are Killed or Injured in a Traffic Accident
• Finding the Court with Jurisdiction over Traffic Accident Lawsuits
• Want to Know Whether You Can Offset the Other Party's Damages Against Your Own in the Same Traffic Accident
• The at-fault party refuses to use their voluntary automobile insurance. What should I do?
• I was seriously injured in a traffic accident in June 2017, before the enforcement of the amended Civil Code (April 1, 2020). Three years have passed (but less than five years) since I completed my treatment. Is the statute of limitations still valid?
• How to Identify a Hit-and-Run Driver from a Vehicle License Plate Number
• Methods of Dispute Resolution in Traffic Accidents
• What You Need to Know About Medical Commuting Transportation Expenses
• How to Find the Insurance Company of the At-Fault Driver in a Traffic Accident
• Understanding Workers' Compensation Insurance in Traffic Accidents (Leave Compensation)
• How Much Is the Standard Compensation for a Traffic Accident?
• What Is Residual Disability Grade Certification in Traffic Accidents?
• How Much Compensation Can You Get for Whiplash from a Traffic Accident?
• Benefits of Hiring a Lawyer for Traffic Accidents
• Key Points When Dealing with Insurance Companies After a Traffic Accident
• How to Calculate Lost Income from a Traffic Accident
• The Relationship Between Number of Hospital Visits and Compensation for Pain and Suffering in Traffic Accidents (Key Considerations When Visit Frequency Is Low)
• What Is Maximum Medical Improvement (MMI) After a Traffic Accident?
• How to Use Lawyer Fee Special Coverage for Traffic Accidents?
• How to Handle a Traffic Accident When the At-Fault Driver Has No Insurance
• Damages in Bicycle Accidents
• Claiming Compensation When a Passenger Is Injured in a Traffic Accident
• Do You Have to Pay a Traffic Fine for a Burned-Out Brake Light?
• "I Said I Would Pay the Full Repair Cost" in a Bicycle Accident
• If Repair Costs Exceed Your Car's Market Value After a Traffic Accident, Can You Still Recover the Full Amount?
• Can a Car Proceed if a Pedestrian Yields at a Crosswalk?
• What Are "Replacement Incidental Costs" When a Vehicle Is Totaled in a Traffic Accident?
• What Damages Can Be Claimed When a Family Member Dies in a Traffic Accident?

See all articles on traffic accidents